Ex-Alberta Premier Peter Lougheed, verging on 80 and widely cherished as the grand old man of western Canadian politics, came out of retirement last week to warn that the country is about to face a clash of provincial authority against federal that could tear it to pieces.

Since Lougheed has never been given to excessive alarmism, the warning – delivered before the annual meeting of the Canadian Bar Association?attracted much press attention. Well it might, for the point at issue cuts to the core of the economic deal that brought the Canadian confederation into being.

It also throws into jeopardy the production output of the Alberta oil sands, which are rapidly becoming America’s leading and hitherto most dependable source of fossil fuels.

Under the Canadian constitution, negotiated in the 1860s as a statute of the British Parliament, the provinces, not the federal government, were given control of natural resources. There were only four provinces at the time – Ontario, Quebec, Nova Scotia and New Brunswick. Soon two more were added: Prince Edward Island on the Atlantic side and British Columbia on the Pacific.

Manitoba gained provincial status then too – at first as a tiny, “postage stamp province” at the eastern end of the vast Canadian prairie. But with Manitoba a distinction was drawn. Ottawa retained control of its resources. When Saskatchewan and Alberta came into being as “prairie provinces” in 1905, the same discrimination applied.

The three “prairie provinces” were established as de facto colonies of Ontario and Quebec, which supplied them with manufactured goods from industries protected by high tariffs. In return, the West sent its grain East to feed and fatten livestock or for export to Britain.

Not until 1929 did the three prairie provinces finally win control of their resources, the privilege extended to the others from the beginning. With the 1950s, however, a great change began. Oil had been discovered in Alberta and with it natural gas in incalculable volumes. When OPEC was formed in the 1970s, astronomically increasing the price of oil, Alberta began a boom, acquiring in the process an unbecoming wealth, highly offensive to the long dominant central provinces. But what could be done? Under the constitution, the oil and gas belonged to Albertans, not to Canadians.

The answer of the Liberal Trudeau government in the early 1980s was the “National Energy Program,” under which Ottawa simply defied the constitution, invaded the province’s jurisdiction and imposed taxes on the resources it didn’t own. The man who defended the province against this onslaught was Peter Lougheed. A secessionist movement broke out in Alberta at the time that drew thousands out to rallies in Edmonton and Calgary. It eventually resolved itself into the Reform Party, later into the Conservative Party, which ex-Reformer Stephen Harper led to power in Ottawa.

But now, Lougheed prophesied last week, Ottawa will use its environmental authority to gain jurisdictional control of the tar sands, forcing a showdown with Alberta “10 times greater” than the fight over the National Energy Program.

“The issue is there front and center, and coming to a head. I think the issues we saw before – and I was involved in many of them – were important. I don’t minimize them.” But “they aren’t even close,” he said, to the coming move of the federal government into the provincial jurisdiction via environmental control.

“My surmise is that we’re going into this constitutional legal conflict soon. This is strong stuff. National unity will be threatened, if the court upholds federal environmental legislation and causes major damage to the Alberta oil sands and our economy.” (That the Supreme Court will uphold the federal authority over the provincial can be regarded as a foregone conclusion. The federally appointed Supreme Court has almost never favored the provinces when a federal-provincial conflict came before it.)

“The government of Alberta, with its acceleration of oil sands operations,” said Lougheed, “will in my judgment be seen as the major villain in all this in the eyes of the public across Canada.”

The chief beneficiaries of this acceleration are of course the American consumers who buy the oil that the tar sands produce, and the people of Alberta who are experiencing by far the biggest economic boom in their history. An Ottawa invasion of the Alberta industry would, in other words, directly threaten the American oil supply. The American government has never bought into the thinking that produced the Kyoto Treaty. The Canadian government has. Lougheed has predicted the consequence.

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